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Theratechnologies stock is heading higher, says Research Capital


The share price for drug company Theratechnologies (Theratechnologies Stock Quote, Charts, News, Analysts, Financials NASDAQ:TH) hasn’t really budged since a recent announcement from the FDA concerning the resumption of one of its clinical trials. But investors should be thinking about TH, nonetheless — that’s according to Research Capital analyst Andre Uddin, who thinks the stock is heading higher.

Montreal-based Theratechnologies announced this past December that it was taking a voluntary pause on its TH1902 drug candidate’s Phase 1 trial due to safety and dosing-related issues. Then on June 2, TH said it had FDA approval to resume the trial, with the latter agreeing to an amended protocol involving lower dosing regimens.

The stock, which two year ago was up around $3.50 per share, eventually fell to around $1.00 after the December news and has been in the $0.80 – $1.00 range over the first half of the year. (All figures in US dollars.)

But Uddin sees upside from here, delivering a note to clients on Wednesday where he reported on an analyst and investor call Theratechnologies held on Tuesday. Uddin said lead investigators for the TH1902 Phase 1 trial spoke of recent events, starting with TH’s striking of an advisory team after the voluntary pause to review the clinical data. The team provided three key amendments, viz., a lower concentration of TH1902 to be administered to patients in attempt to reduce dose-related toxicities; changes to dosing frequency; and tumour type selection and stricter eligibility criteria, where moving forward the trial is expected to primarily focus on enrolling specific tumour types (mainly ovarian) and with stricter patient selection criteria.

“The primary reason for the new dosing regiment is to ideally improve efficacy with more frequent dosing (TH1902 is comprised of a peptide targeting SORT1 – a short half life) and to lower dosing – to try to reduce safety issues, patients that responded best are now to be targeted. TH1902 appears to have a safer profile to doxetaxel (referring to its prescribing info),” Uddin wrote.

With the update, Uddin reiterated a “Buy” rating on TH and $4.50 target price, reflecting at press time a projected return of 374 per cent.

“With the recent the trial resumption FDA go ahead – we believe THTX is poised to trade higher – presenting an intriguing trading opportunity. New sales momentum may also be playing out – perhaps also due to Egrifta SV & Trogarzo Rxs moving higher (Figures 6 & 7), but it is still too early to call. THTX is also positioned to turn EBITDA positive by year end,” Uddin wrote.

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